Open Architecture
Candlefocus EditorRather than having to shop around for services from different firms, clients can purchase products that are tailored for their specific needs on the same platform. Furthermore, due to the competitive nature of the open architecture system, banks have been more incentivised to introduce lower fees, greater transparency, and more competitive pricing. All of these changes have been highly beneficial for investors and individual clients.
Open architecture systems also grant clients a great deal of flexibility. Clients are now able to handpick their own products and services, and they no longer have to choose all their services from a single source. Furthermore, not only are the services that clients can choose from much more versatile, but they may also be tailored to an individual's specific requirements, as well as their risk profile, depending on the service provider that is offering the product.
The open architecture system is also encouraging a level of innovation and creativity among banks that could potentially result in an increase in customer service and convenience. Banks may now be able to come up with new ways to better serve their customers, from improved access and convenience to better-tailored products.
Overall, open architecture has revolutionised the way banks, investment firms and their clients interact. Although this system does carry a few risks, such as the potential for financial fraud and misconduct, the potential benefits that it offers are proving to be too great to ignore. The ability to create a customised portfolio of services and products; the increased flexibility; and the improved transparency of fees have certainly had a positive effect on the investment industry. The open architecture system looks like it is here to stay, and its potential for continuing to revolutionise the banking and investment world is exciting.